{ "id": 1808, "date": "2023-02-10T23:09:11", "date_gmt": "2023-02-11T04:09:11", "guid": { "rendered": "https:\/\/aucanadavisa.com\/?page_id=1808" }, "modified": "2023-02-22T20:03:31", "modified_gmt": "2023-02-23T01:03:31", "slug": "buying-your-first-home-in-canada", "status": "publish", "type": "page", "link": "https:\/\/aucanadavisa.com\/en_ca\/useful-infos\/settling-in-canada\/buying-your-first-home-in-canada\/", "title": { "rendered": "Buying your first home in Canada" }, "content": { "rendered": "
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As the years go by, each room becomes an album for your memories and milestones, your good years and hard years, as you carve out a life for yourself and your family.<\/div><\/div>

Getting your first home in a new country is undoubtedly stressful. That\u2019s why we\u2019ve teamed up with the experts at HSBC Canada to help you understand how to navigate the Canadian real estate market. Many Canadian residents have gone through this process before you, so it\u00a0is<\/i>\u00a0possible. Plus, in\u00a0recent years<\/a>\u00a0immigrants have surpassed their Canadian-born counterparts when it comes to homeownership rates, so buying your own home as an immigrant in Canada: it\u2019s achievable.<\/p>

Empower yourself to make the best decision about your new home by informing yourself about the Canadian market. And when it comes to financing your new home, empower yourself by choosing one of Canada\u2019s most trusted banks. HSBC\u2019s Newcomers Program is tailor made for newcomers like you. Check out the\u00a0HSBC Newcomers Program<\/a>\u00a0to learn how you could be eligible to receive up to $1,350* in value.<\/p>

Where do you want to live in Canada?<\/h3>
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The city of Toronto is one of Canada\u2019s most popular destinations for new immigrants and one of the country\u2019s most expensive cities to buy a home.<\/figcaption><\/figure>

You already know that Canada is a big country, and you probably realize that where you choose to live will have a big impact on the process of buying your home. In smaller cities and rural areas, the cost of a home is significantly cheaper than in some of Canada\u2019s larger cities.<\/p>

In 2018, the\u00a0average cost<\/a>\u00a0of a home in Canada was CAD $472,000; this includes all types of homes (condos, houses, duplexes, etc.). But this figure is hugely influenced by two cities, Toronto and Vancouver, where the cost of a home is significantly\u00a0 higher than the average for the whole country. If you remove Toronto and Vancouver from the equation, the average home in Canada costs $375,000.\u00a0<\/p>

If you\u2019re willing to live outside the major cities, you\u2019ll be able to find a nice home in Canada at an affordable cost. But if you\u2019ve got your heart set on living in Toronto or Vancouver, you have to prepare yourself for the home prices in these cities. You can expect housing prices to be double the national average if you\u2019re looking in\u00a0Toronto<\/a>\u00a0or\u00a0Vancouver<\/a>. We\u2019ve seen many immigrants drawn to cities like Winnipeg, Ottawa, and Edmonton, where there are still big immigrant communities, but housing costs are much lower compared to Toronto and Vancouver.\u00a0<\/p>

That said, the Toronto and Vancouver areas are popular destinations for newcomers to Canada, and to some extent higher living costs are offset by higher wages. Both cities have bustling industries and big immigrant communities, so they are great places for finding work and connecting with specific cultural communities.<\/p>

If you want to have access to Toronto or Vancouver, but you can\u2019t afford a house in the city, consider one of the neighbouring cities. For example, many newcomers who want to be near Toronto will opt to live in Markham, Mississauga, or Hamilton. These three cities are close to Toronto, but offer better affordability when it comes to buying a home. As well, all three of these smaller cities have big immigrant communities, so you\u2019ll have the chance to meet other newcomers who\u2019ve experienced a journey similar to your own.<\/p>

Over the years, we have seen that many newcomers to Canada will first gravitate towards the city centres. You might come to Canada with temporary status, on a work permit or study permit, and so your place of employment or university may be in or near the downtown core, affecting your decision on where to live. After securing permanent residence, however, many people tend to think about extra space for themselves and their family, and may be more conscious of affordability over the longer term. Outlying suburbs and smaller cities might become front of mind, particularly for those who want to purchase a home in Canada.<\/p>

Take your time. Talk to your friends, your coworkers, your neighbours. Canada is a friendly place and that\u2019s probably one of the reasons you moved here. The people around you will be more than happy to share their stories about buying homes in Canada. Let them share, and allow their experiences and advice to guide you on your home buying journey.<\/p>

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These side-by-side townhouses are popular in the bustling Canadian cities of Toronto, Montreal, and Vancouver.<\/figcaption><\/figure>

Once you\u2019ve decided on where you want to live, the next step is figuring out what type of home best fits your budget and your needs.<\/p>

What kind of home are you looking to buy in Canada?<\/h3><\/div>

Not all types of homes are the same, and each type has a different price level. Let\u2019s take a look at your options:<\/p>

Condo\/Condominium:\u00a0<\/b>A condo is a unit within a larger building. If you\u2019re buying a condo, you won\u2019t be buying the entire building or the entire property, but just your own unit. In busy city centres, condos are often the best options available on the market.<\/p>

Single\/Detached:<\/b>\u00a0A detached home is a building located on its own property that shares no walls with neighbouring properties. You own, and are responsible for, the land and the building. This tends to be the most expensive type of housing in Canada.<\/p>

Semi-Detached:\u00a0<\/b>A semi-detached home is a property with its own land and entrance but which shares a wall with a neighbouring home.<\/p>

Townhouse:\u00a0<\/b>A townhouse is a home which is attached to other homes on both sides. These types of homes are typical in Canada\u2019s major cities.<\/p>

Duplex\/Triplex:\u00a0<\/b>A duplex or triplex is a single building that has been divided into multiple, separate units. This can be attractive for some buyers because they can rent out the other units as a means of offsetting the cost of the property. Maybe you\u2019ve got kids, and once they\u2019re accepted to university, they can rent one of the units (whatever it takes to keep them close to home!).<\/p>

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It\u2019s important to set realistic expectations for the type of home you can afford based on the area you want to live. In downtown Toronto, you\u2019ll find it difficult to locate a detached home, much less afford one (we\u2019re pretty sure that even Drake lives in a condo building), but you might be able to find a condo that will suit your needs. On the flipside, if you\u2019re willing to live outside Canada\u2019s most popular cities, a detached home becomes much more affordable.a<\/p><\/div><\/div><\/div>

How much can you afford to spend on your home?<\/div>

Like many countries around the world, Canada uses a mortgage system to organize the purchasing of homes and properties. Make sure you understand these concepts before you move forward in your buying journey.<\/p>

Mortgages in Canada for newcomers<\/h3>

Under the mortgage system, a home buyer will pay a down payment (known as a deposit in some countries) for their home and then pay for the rest of the home using a mortgage. A mortgage is a financial loan from a lender, often a bank, used to finance the purchasing of a home. The home buyer then repays the mortgage over a period of years, with an interest portion also being paid to the lender.<\/p>

Let\u2019s go over the basics of mortgages in Canada, so that you know exactly what to expect on the Canadian real estate market.<\/p>

Down payment<\/h3>

In Canada, the minimum possible down payment for a new home is\u00a0five percent<\/b>\u00a0of the total cost of the home. However, it is often recommended to make a larger down payment than this. If the home buyer can pay a downpayment of 20 percent or above, then usually they are not required to pay for mortgage insurance.<\/p>

As a newcomer to Canada, you may not have the credit history in Canada that many banks and other lenders require in order to approve a mortgage with only a small down payment. But! Many banks and lenders offer mortgages for newcomers, provided that the newcomer can afford a higher down payment, usually around 35 percent.<\/p>

Alternatively, you can wait until you have worked in Canada for a couple of years and established a credit history, and then apply for a mortgage through the regular channel, with a smaller down payment required. Plus, this way you have the opportunity to experience life in Canada and really be sure that you\u2019re choosing a location you enjoy.<\/p>

Let\u2019s say you\u2019re looking to buy a new condo in downtown Toronto. You find a sleek new unit, with a great view, and a gym (you\u2019ll have no more excuses to skip leg day!). The price of the condo is CAD $750,000. As far as your down payment is concerned, here are your basic options:<\/p>