Real Estate Investment

First-Time Homebuyers

First-Time Homebuyers: What You Should Know

How Much Will it Cost to Purchase a Home?

The journey of purchasing your first home is an exciting milestone filled with anticipation and decision-making. However, during the thrill of house hunting and envisioning your future in a new space, there are some important financial considerations that first-time homebuyers must be mindful of. From deposits to property taxes, navigating the complex landscape of homeownership requires thorough understanding and preparation. 

The VanDinther Team is here to help you understand some of these complex decisions that will need to be made. In this blog, we’ll delve into the essential aspects that every first-time homebuyer in Canada should know before making one of life’s most significant investments.

Deposits and Down Payments in Canada

As a first-time homebuyer in Canada, understanding the difference between deposits and down payments is so important. Typically, a deposit ranging from 5% to 20% of the home’s purchase price, is provided upon the acceptance of your offer. This is to demonstrate your commitment to the transaction. 

Down payments, on the other hand, represent the initial payment made towards the total purchase price of the property. In Canada, a minimum down payment of 5% is required for homes valued at $500,000 or less. For properties exceeding this threshold, a 10% down payment is needed for the portion above $500,000, up to $999,999. 

It’s important to note that you should have your finances in place and a budget before the house hunting begins. This will not only help the REALTOR select properties in your price range, but also ensure that you won’t be caught off guard when the deposit or down payment is due. 

Land Transfer Tax and Appraisal Fees

Homebuyers are subject to pay a land transfer tax in Canada if they already own a property. The government of Ontario explains it like this, “the increased limit of $4,000 applies only to conveyances or dispositions that occur on or after January 1, 2017, regardless of the date the agreement of purchase and sale was signed.” This tax rebate will not be able to be applied again since you can only be a first time buyer once. 

This tax varies depending on the province in which the property is located. It’s essential to research and factor these costs into your budget, as they can significantly impact your overall expenses.

Additionally, appraisal fees are incurred to assess the fair market value of the property. While these fees may seem like an added expense, they provide valuable insights into the property’s worth and ensure that you’re making an informed investment decision. In the next section we’ll learn about home inspections and property insurance. 

Home Inspection and Property Insurance

Before finalizing the purchase of your home, investing in a thorough home inspection is highly recommended. This is when a professional inspector can identify potential issues with the property, allowing you to negotiate repairs or adjustments to the purchase price if necessary. This is a very important step in the home buying process. 

Once you’ve secured your dream home, it’s time to get property insurance. It is imporant to protect your investment against unforeseen circumstances such as fire, theft, or natural disasters. While not mandatory in all provinces, property insurance does offer peace of mind and financial security for homeowners. The next section of this blog we’ll discuss Mortgage Insurance and Legal Fees.

Mortgage Insurance and Legal Fees

For first-time homebuyers in Canada with a down payment of less than 20%, mortgage insurance is required by lenders to mitigate the risk associated with smaller down payments. This insurance safeguards the lender in the event of default and enables homebuyers to access homeownership with a lower initial investment.

Legal fees, including lawyer fees and title insurance, are incurred during the closing process of the property purchase. These expenses cover the legal aspects of transferring ownership and ensuring that the property’s title is clear of any encumbrances or disputes.

Property Taxes, Moving Costs, and Land Survey

Property taxes are an ongoing expense that homeowners must budget for annually. These taxes vary depending on the municipality and are based on the assessed value of the property. It’s essential to factor in property taxes when determining your overall homeownership costs.

Moving costs, including hiring movers, renting a moving truck, or purchasing packing supplies, should also be accounted for in your budget. Planning ahead and obtaining multiple quotes can help minimize these expenses and streamline the moving process. We recommend doing some research for movers in your area, our team is always happy to assist our clients in this process. 

Lastly, a land survey may be required to confirm the property’s boundaries and ensure compliance with local regulations. While not always mandatory, a land survey provides valuable information and may be requested by lenders or insurers during the homebuying process. 

Contact the VanDinther Team 

Navigating the journey of purchasing your first home can be both exhilarating and overwhelming. But by understanding the essential financial aspects outlined in this blog, first-time homebuyers can approach the process with confidence. 

From deposits and down payments to property taxes and moving costs, thorough preparation and research are key to achieving your homeownership goals. You can count on the VanDinther Team to be there for you every step of the way, because helping you make the right moves is our goal. 

So as you embark on this exciting chapter of your life, remember to reach out to experienced professionals and lean on the wealth of resources available to support you along the way. With careful planning and informed decision-making, your dream of owning a home in Ontario can become a reality. Contact the VanDinther Team today and get your journey of home ownership started! 

Contact the team directly by phone at 905-330-2002 or by email at

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Make Your Rental Property a Profitable One

It’s no secret, rental property can generate passive income and help you reach financial freedom. It’s very attractive to people these days who have a little bit of extra money to put towards an investment. And investing in real estate is a good thing. Just look at Donald Trump – he made billions by investing in real estate development. Not the same thing as real estate property rental, but you get the point. People need to live somewhere – it’s a basic human need – and they will do without other things before they do without their home. So it’s a bit of a guarantee and safety.

Rental Property Income

When you buy your first home you’re just focusing on that, all your goals are towards getting into that home and nothing else.
But once you make your move, you settle in and start paying off your mortgage that’s when you start to wonder – what if I had another house that I can buy by putting a small down payment and using my current home as collateral so that I can rent out this new house to some (hopefully) good tenants and slowly over the time, not only make money, BUT have my mortgage paid off for me by someone else’s money. One day I can sell that and retired happily. Admittedly, it’s a very attractive idea!

But… and there is always a but, it’s not a walk in the park. There are many landlords who wish they knew some things prior to getting into rental properties. Do some searching on Google and you’ll see hundreds of posts of landlords complaining about how much work, effort, demand goes into making your rental property a profitable one.

This can happen to your rental property!
This can happen to your rental property!

So to summarize some of these main key points that every prospective landlord should know…

  • The place has to meet zoning and fire code regulations. Meaning you can’t cram all these tenants into one house to try to maximize your profits. Find out from your local municipality about all the rules and regulations. Same thing goes for insurance. Find out before you embark on this. You wanna avoid a situation where your are getting penalty by the city because you didn’t make sure you meet regulations. Or that if something happens like a  fire, your insurance doesn’t wanna cover because you had too many people living there and you didn’t tell them.
  • Don’t count on keeping all the rent money. You are going to have to pay property taxes, maintenance expenses. Plus if your tenants are coming and going all the time, that’s lost income during the months you had to get the place ready for the next guy. Also you’ll have to report your rental income when you do your taxes.
  • You may have to remodel the home to make it attractive to tenants. If you are trying to rent out parts of your house, you may have to create a separate entrance, or add a kitchen or an extra bathroom etc. What about parking. This may not be a big deal if you are renting a whole house to single family but if you’re renting out each floor to individual families then it matters.
  • Carefully screen your tenants. Because you can’t just kick them out if they do something you don’t want them to do, like get pets, or have babies or are even late on their rent all the time, make too much noise, smoke, have people coming over, etc. There is something called Residential Tenancies Act here in Ontario and I’m sure in other places too that protects tenants and fights for their rights . So you want to end up with good people on your hands NOT some amateurs. This is why doing some background checks is recommended. But be careful there too, many people fake their references. You have to be creative and smart.
  • Can you do any handywork around the house? You better, because there will be many times when you’ll get a phone call: hey my toilet won’t flush, taps are leaking, fuses is burnt out. Yes most people should be able to fix that themselves BUT they don’t have to. So they’ll call you at whatever time of the day or night and ask. You have to respond in appropriate time and manner. Some people might want to outsource property management to professional, but then you’re paying them a fee. It’s a 50/50 situation. You decide.
  • Managing a property is and can be like a part-time job. Don’t expect to just collect money and wash your hands off the place. You will have to visit from time to time to see how things are looking. Did they destroy the palace OR are the keeping it up. You may have to respond to problems unexpectedly. Murphy’s law states: anything that can go wrong, will go wrong. So you have to allow for that.
  • Don’t forget to collect rent on time and don’t forgive those who are late. Many of us have been in a pinch, or things took an unexpected turn and now you’re out of money or running low this month. So you can’t pay rent. That can be understandable. BUT if you forgive your tenants and say just pay me when you can, this sets a bad precedent. You give them one finger, they take the whole hand. Sadly, this is true. People are creatures of habit, and they will learn they can always ask you for extensions. Don’t teach them this. Be polite but firm. Can’t pay rent? There is a penalty and deadline. If you can’t meet that, out the door. Seriously. There are other people who will pay on time. Why should you be a charity.
  • Reward the good tenants. Yes that’s right. If they’re good, they keep the place nice and clean. You have no problems from them. Cherish them! Make them happy. It’s a small investment to give them free internet and/or cable. Or don’t raise their rent or something – they’re saving your money in the long term so you should understand that and appreciate that. A good tenant is the one you never hear from and the rent is paid on time, place is kept clean.
  • Let a real estate agent help. They will often help you picking the right property, help you show property to potential tenants. This can be a huge time saver and gives you that second hand that you need. They can do credit checks, arrange viewings, etc. And of course when you’re first buying property to rent out, they can help you pick the right area. Why is this important? Because you want to buy property that’s in a relatively affordable, decent area where crime is low, amenities are close and people are not classy. This all gives you an insight into your potential tenants and how much you’ll be earning from rent.

Here is a helpful website with information about renting your home

happy tenants

Are you thinking of getting a rental property in Burlington, Ontario and surrounding areas? Do you need some help in figuring out what’s the best neighborhood to invest in? Talk to Lori VanDinther, an experience and trusted Burlington resident and real estate agent! She will work hard to share her knowledge and experience in buying rental properties in Burlington.
It’s a big task, don’t do it alone.

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