Buying a home in Ottawa - A Step-by-Step Guide
The following document is excerpts taken from the CHMC publication called Home Buying; Step-by-Step, which can be located in its entirety on the CMHC website
http://www.cmhc-schl.gc.ca/
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Assessing your housing needs |
For most Canadians, owning their own home is a lifelong dream. It brings with it pride of ownership, security and the feeling of control over which improvements are made and how much they cost. There's also the chance your home will increase in value, making it a sound financial as well as a lifestyle investment.
GETTING STARTED: When buying a home, you have to juggle three important factors - your prospective home's location, style and cost. For example, your goal may be to buy a single family detached home in an urban neighbourhood for $150,000. But you may have to settle for two out of three. An urban semidetached home may be available for your price, or you may need to look in the suburbs for the price and style you want. Call your Mario to discuss price vs. area.
LOCATION, LOCATION, LOCATION: Your choice of location depends primarily on where you work and whether you want to commute, and also on your family lifestyle. Do you want to live near recreation facilities such as a golf course or skating rink? How close are your children's schools? Is public transportation available?
Urban living usually offers the largest range of home styles and often is closer to amenities such as restaurants and theaters. On the other hand, you may get more for your money in the suburbs. Suburban homes often have larger lots and larger square footage than urban homes in the same price range. While suburban homes can have the advantage of being newer, amenities like shopping or playgrounds may not be available yet in a new subdivision.
If you're considering moving to an unfamiliar neighbourhood, take time to drive or walk around it, both during the day and in the evening. Make some notes. It's also a good idea to travel the route to and from your work. There are many other factors you should consider when choosing the location of your home. For example, have property values risen or fallen in the neighbourhood? Future development can also affect property values and property taxes, so you'll want to consider whether there are any changes to zoning proposed or any major developments planned. To do this, contact the local municipal office regarding planning and zoning bylaws. Is a high-rise office tower going in next to your home? A new highway? Zoning bylaws may also affect your own plans, such as conducting a business from your home.
Some real estate representatives suggest that, if you're considering the future resale value of your home, it's wiser to buy a modest home in the best neighbourhood you can afford than the most expensive home in a modest neighbourhood. Location is an investment too.
NEW OR RESALE: There are advantages and disadvantages to both new and resale homes. Here are some of the characteristics of both that may help you make your choice.
New Home ADVANTAGES
- You may be able to upgrade or choose certain items such as siding, finish materials, flooring, cabinets, plumbing and electrical fixtures.
- The latest building code, electrical and energy-efficiency standards will apply.
- A builder warranty is usually available in all provinces and the Yukon (but not the Northwest Territories). This can be important if a major system, such as plumbing or heating, breaks down.
- Unless you are a builder, warranties do not apply to homes you build yourself.
New Home DISADVANTAGES
- Higher price
- no negotiations
- expensive to upgrade
- house has not settled
- Neighbourhood amenities, like schools or shopping, may not be complete if the house is in a new development.
- There may be construction noise and traffic.
- There may be little to no landscaping or trees.
- The 7% GST applies to new housing. However, there is a rebate, to a maximum of 2.5%, on homes which cost less than $450,000.
Resale Home ADVANTAGES
- Cheaper per sq/ft
- save thousands in extras
- It will probably be in an established neighbourhood.
- Landscaping is usually done and fencing installed.
- It may have upgrades such as a built-in swimming pool or finished basement, C/A, C/V, eavestrough, deck, shed.
- There is no GST unless the house has been renovated substantially, and then the tax is applied as if it were a new house.
Resale Home DISADVANTAGES
- More maintenance might be needed
- Maintenance costs will likely be higher than for a new house.
- You may need to redecorate, or even renovate, which is still thousands cheaper than upgrading a new home.
Condominium: The word condominium refers to a type of property ownership rather than to a style of house.
- Condominiums can be townhouses, high-rises or low-rises. They can be attractive to first-time home buyers because they are generally less expensive than single detached homes in the same neighbourhood. When comparing costs, make sure to include monthly condominium fees.
- When you buy a condominium, you're investing in something you own, but likely eliminating maintenance such as yard work and snow removal. Condominiums also can offer extras you won't get in a similarly priced detached home, such as security systems and recreation facilities.
- Be prepared to pay monthly condominium fees that contribute to the corporation's reserve fund and go toward covering the collective cost of property maintenance, repairs, replacements and insurance.
- When buying a condominium, many of the same considerations as buying a detached home will apply. For example, the choice of location or the decision between new and resale.
- With a new condominium, you may be able to specify upgrades or finish materials, while a resale condominium is more likely to be in an established location and may have lower condominium fees.
- Before you buy a condominium, it's also important to consider some of their limitations. If a large yard is important to you, for example, a condominium is not a good choice.
