What Do First-Time Home Buyers in Alberta Need to Know
With mortgage rates at an historical low and house prices continuing to dip, it's a great time for the first-time home buyer to get in on Alberta's housing market. But before you sign on your first mortgage, there are several important considerations to take into account. Here are a few important things to know about purchasing your first home.
Who's on Your Team?
As a first-time home buyer, it's important to gather a team of professionals around you who can guide you through the process of purchasing a property. At the minimum, you'll want to seek the advice of a real estate agent, a real estate lawyer, and a mortgage broker before you begin shopping for a home.
Types of Home Ownership
There are four main types of home ownership in Alberta: freehold, leasehold, condominium, and co-operative.
- Freehold:This means you own the house outright as well as the land it sits on.
- Leasehold: With a leasehold, you own the property but lease the land the property sits on.
- Condominium:This is similar to an apartment, but you own a unit and pay monthly maintenance fees.
- Co-operative:This means you own a share in a building and live in one of the building units.
As a first-time home buyer, it's important to weight the advantages and disadvantages of each of these types of homeownership. If, for example, you plan to stay in the home for just a few years, buying a freehold home may not be the best financial strategy.
First-Time Home Buyers Tax Credit
As a first-time home buyer, you can claim a non-refundable tax credit of $5,000 for the purchase of a qualifying home. This credit is called the Home Buyers Tax Credit (HBTC). In order to qualify as a first-time home buyer for tax purposes, you and/or your spouse must have acquired a home, and the home must be the first property owned by you and/or your spouse in the last four years.
If you've decided that home ownership is the right choice for you but don't know where to begin, we can help. Contact a mortgage broker today to discuss your needs and goals as a first-time home buyer.Request Mortgage Info