Advice for First-Time Buyers in 2024

First-time buyers may be wondering if 2024 is the right year to get into the Toronto Real Estate market by buying their first home. If you’re thinking about making your first purchase in the coming months, there are many things you can do now to set yourself up for success.

Do you have a lease that’s expiring soon, and you want to start contributing to your own future rather than paying off someone else’s mortgage? This is the biggest reason to do whatever it takes to make your first purchase. Why give money to your landlord’s future instead of putting money into your own pocket? Now is the time to make moves to put yourself first!

The biggest thing to remember is to not be overwhelmed – buying should be a fun and educational experience. Yes, we said it – fun.

Now or Later – What’s Best for First-Time Buyers in 2024?

When examining the current market, we have strong recommendations for first-time buyers in early 2024 . BUY! Now is an incredible time to get into the market, and this may come to a surprise to many as the headlines typically say the opposite.

Why you ask? Inventory is HIGH. Demand is low. Prices are down. There is very little competition in the market so no bidding wars are driving up prices for absolutely no reason. No multiple offers and plenty of beautiful homes and condos are available. Sellers are also very motivated.

Yes, interest rates are up but they are showing stability which is a very good sign. But, with these good signs, that means the market will be picking up soon.

So, what steps can you take to prepare? The first step is to form your real estate team. Finding an experienced Real Estate Broker who has a proven track record with first-time buyers is an important step.

We pride ourselves on educating first-time buyers through every step of the process. You should be excited to purchase your first house or condo – if you’re feeling less than that, it’s time to re-evaluate your team.

Buying for the first time shouldn’t be stressful, and with our list of things you can do now, you won’t have to worry about missing any of the critical steps in your first-time buyer experience.

Get a Mortgage Pre-Approval

A mortgage pre-approval will tell you how much you qualify for. This is a critical first step for first-time buyers in 2024, as you will work with a mortgage agent to get all of your qualifications in order. A good mortgage broker will guide you and educate you on the pre-approval process, and give you comfort in knowing exactly what your budget range is so you can start looking for a home you can afford.

How Much Can You Afford?

Think about your monthly costs. What can you afford to pay per month for your mortgage? Think about your other monthly costs too. Insurance, public transit pass or car loan, grocery bills, entertainment and anything else you pay on a monthly basis that will impact your home costs. Just because you are approved for a certain amount doesn’t mean that’s what you should actually pay.

First Time Buyers in 2024: Saving for a Down Payment

Living in a big city like Toronto where everything is pricier than most other parts of Canada, saving for a down payment can be a challenge. And it will not be fun – we get it. But this is how smart people save a lot of money.

They make lifestyle changes by finding different, cheaper ways of doing things without diminishing their fun. Here are some great examples we found:

Stick to one entertainment outlet. If you have cable TV, cancel your Netflix account. Can’t live without Netflix? Cable has to go. There are so many ways to spend money each month on entertainment, and you may feel that you need all of them – try to pick your most-watch or go-to account and stick with it.
Getting a lot of takeout? Try limiting your ordering to once per week. And when you do order, go pick it up yourself – not only does it help your bank account, it helps put more of that money into the restaurant’s pocket.
Do you buy a lot of new clothes? Limit yourself to only 5 new pieces of clothing, shoes and accessories per season. And when you buy, look for off-season deals. We love a good semi-annual sale.
If you’re saving for a down payment, you should think about shelving any major holiday plans. Don’t spend that saved-up money on an epic holiday once we can. Take that money and put it towards your amazing condo or house you’re going to purchase. At the very least, think about road trips or visiting a friend’s cottage instead of getting on that flight as soon as the winter blues hit.
Pick your at-home workout like your entertainment source – just one that covers it all. There’s no need for multi-platform workouts. Look at an option that has thousands of on-demand classes that you can do anywhere any time for a yearly fee. Even better – use YouTube as your main fitness platform and save all that money each month.
Consider a side hustle. Smart savers know that they can make extra money on the side by doing various jobs. Are you really good at digital marketing? Consider a small consulting job for a handful of mom-and-pop shops that need help in your neighbourhood.

Borrow from your RRSP or Use a Tax-Free Savings Account

You can withdraw up to $35,000 from your RRSP to buy your first condo or house. This is a great way to come up with a down payment if you already have some RRSPs. If you don’t, this may be a good way to save money for your RRSP and at the same time get a tax credit to help reduce your taxes.

The only catch to this program is that you have to pay the money back to your RRSP within 15 years. If you don’t repay the money, it is treated as income and you will have to pay tax on the money you withdrew as though it were income.

A Tax Free-Savings Account can also be a great place to save your down payment money as your money can grow tax-free in this account. This means you won’t have to pay income tax on the money you earn as it grows.

We recommend consulting you’re your financial advisor for more information on how these options can work best for you.

First-time buyers in 2024 are going to have a distinct advantage in the market. Make sure you’re ready to jump when the time is right.

Want to learn more about when the right time to get into the game will be in 2024? Fill out our form below so we can help you get exactly what you want and start putting your money towards your future.