3 Ways to Save Money for First Time Buyers

Three Ways to Save Money for First Time Buyers

 

As we move into February we begin to think of taxes and how we can minimize what we pay to the government. One way to ensure you are saving more of your money is to contribute to your RRSP. The money that you put into your RRSP not only provides you with a tax break, it can be used to make up some or all of your down payment for a house through the Government’s Home Buyers Plan (HBP).

This is a fantastic way for first time buyers to get into the housing market and use money you would normally pay in taxes to help you buy a house. Depending on your tax bracket if you put your down payment into an RRSP you will get tax relief. What better way to fund a down payment than with money the government sends you in a tax refund.

This plan began in 1992 and the Canadian Real Estate Association has been lobbing the government for many years to enhance this plan. In April the Canadian Real Estate Association (CREA) leaders went to Parliament Hill to lobby MP’s to index the Home Buyers’ Plan (HBP) RRSP withdrawal limit to ensure that it never loses its buying power. In 2008, the CREA lobby was successful in lobbing MP’s to raise the withdrawal limit from $20,000 to $25,000. Last year we also recommended extending the HBP to all homebuyers for two years as a temporary stimulus measure. Over 2,000,000 Canadians have already used the Homebuyers Plan to help their dream of home ownership come true.

Buying a first home is an exciting time. The funds can be used for down payment, legal fees, moving expenses and other things related to buying your first home. The money that you remove from your RRSP must be repaid into the account over 15 years. You must replace a minimum of 1/15th of the money your remove each year or repay the taxes on that same amount. There is no tax charged to take it out.

First time buyers also receive a Land Transfer Tax break/discount on the first $2000 for a resale home. If you are a first-time homebuyer, you may be eligible for a refund of all or part of the tax, depending on the price of the home you choose.

The government also assists first-time home buyers by providing up to $750 in tax relief to help with the purchase of a first home.

So if you are thinking of purchasing a home in 2010 contact me today at ruth@ruthballantyne.com and I can help you confirm dates, deadlines and the definition of a First Time Buyer to ensure you get the most from it. There are some exceptions where previous homeowners may qualify. It may be away for you, your family and friends to use money you already have, or get more money by way of tax relief to purchase the home you have always wanted.

OPEN HOUSE SATURDAY FEB 6, 2-4pm AT 16 BACCARAT CRES, BRAMPTON

Please join me at my open house tomorrow at 16 Baccarat Cres, Brampton from 2-4pm.

 

Mayfield & Hwy 10 Brampton

Stunning 4 Bedroom, 2616 Sq Ft Cameron Model Built By Tribute. Boasts A Family Size, Eat-In Kitchen With Gleaming Ceramics, Breakfast Bar & Walk-Out To Huge Pool Size Backyard. Open Concept Family Room With Gleaming Hardwood & A Cozy Gas Fireplace. Separate Living & Dining Rooms & A Convenient Main Floor Laundry Room With Entrance To Double Garage. Basement Has A Rough-In Bath & Cold Cellar. Includes: All Appliances, Window Coverings, Light Fixtures, Central Vac, Central Air, Garage Door Opener With 2 Remotes.

Here is a preview.

If you are thinking of selling your house, click here

If you are currently looking to buy a home, click here

Heated housing activity throughout 2009 lends little air to bubble theory in the GTA, says RE/MAX

 remax

Below is a press release from RE/MAX Ontario.  If you are considering selling, but thinking of waiting, here is some important information for you.

Despite limited inventory levels in the Greater Toronto Area (GTA) in the latter half of the year, double-digit price appreciation failed to materialize in the single-detached housing category in 2009, says RE/MAX Ontario-Atlantic Canada.

Single-detached housing values remain slightly off peak 2008 levels in 27 per cent of TREB districts.
 

 

Continue reading “Heated housing activity throughout 2009 lends little air to bubble theory in the GTA, says RE/MAX”

JUST LISTED! 2 Cranbrooke Court, Brampton OPEN HOUSE THIS WEEKEND

Please join me at my open house this weekend at my new listing at

2 Cranbrooke Court, Brampton
Located in Desirable Stonegate!

OPEN HOUSE

Saturday, Jan 30 2-4pm & Sunday, Jan 31 2-4pm

Asking $699,000. Canterbury Model With 3700 Sq. Ft. On A Fantastic Court Location In Stonegate. As You Approach This Home You Will Notice The Majestic Double Door Entry. The Elegant Entry Has Granite Floor. Main Floor Has Been Totally Upgraded. Stunning Gourmet Kitchen Has Granite Counters And Floor. Sunken Living Room. Main Floor Den. Coffered Ceiling In Living Room And Kitchen. Upgraded Moulding. Powder Room With All Ceramic Walls, Entrance To Garage From Laundry. Upstairs There Are 5 Spacious Bedrooms. All Are Large With Double Closets. Master Has 6 Pc Ensuite And Main Bath Has Seperate Shower Stall.

Visit www.2Cranbrooke.info for more pictures & info.

If you are thinking of selling your home, please go to www.27TipsForSale.com

Why now is the best time to think about buying and selling in 2010

Why now is the best time to think about buying and selling in 2010

 

Traditionally we see an upswing in real estate transactions in the “Spring Market” (March, April and May) here in Brampton and the surrounding GTA. This year we have a few extra reasons to buy and sell in the first half of the year that are beyond the traditional spring fling.

The first reason is an announcement made recently by Federal Finance Minister Jim Flaherty. Until July 2008, Canadians had the option to amortize their mortgage up to 40 years. This meant that you could choose to pay your home over 25, 30, 35, up to 40 years. We also had zero down payment loans available at that time. As a result of the housing crisis in the United States,our government changed this rule and adjusted the amortization to 35 years. They also reinstated the 5 per cent down payment as a minimum. Recently he hinted that he may change the options once again.

He has pondered about increasing down payments to an even higher level and reducing the amortization period further. This will definitely affect the real estate market. It will probably mean that less people will be able to buy. First time buyers will struggle to save the necessary down payment and with higher interest rates, mortgages will be less affordable not only for first time buyers but buy move up buyers as well. If you were planning on moving in the second half of the year you may save thousands buy purchasing your home that bit earlier.

Another way to get more for your money at this time of year is to use the Government Home Buyers Plan (HPB). The government allows you to withdraw up to $25,000 from your RRSP to use towards your down payment. The money not only becomes your down payment but can provide you with a tax break This is a fantastic way for first time buyers to get into the housing market and use money you would normally pay in taxes to help you buy a house.

Depending on your tax bracket, if you put your down payment into an RRSP you will get a refund. What better way to fund a down payment?

You must act on this now, though, as the money must be put into your RRSP prior to Feb. 28, 2010.

The third reason is the HST that will come into effect on July 1, 2010. The HST will combine the current GST (5%) and PST (8%) to create one tax, HST at (13%). This tax will apply to new homes over $400,000 and too many home closing costs, adding to the cost of a resale home and thousands to the cost of a brand new home. Under the current system many of the services associated with the purchase of a Resale home are only charged the 5 per cent GST. This means that mortgage insurance premiums, legal costs, real estate commissions, home inspections and title insurance will now all have an additional 8% tax. Put these three things together and you can see why buying a home in the first half of the year could save you money.

As published in the Brampton Guardian January 27, 2010

http://zoominlocal.com/ml-brampton-guardian/2010/01/27/#?article=738957

Call 3-1-1 anytime for access to all municipal services!

Don’t have time to place a call to Brampton City Hall during the day when you’re at work?

Don’t know who to call for municipal information or a specific service?

Brampton has recently introduced 311 – a new, easy-to-remember telephone number that’s now available 24×7 for you to call for assistance whenever it’s convenient for you.

311 provides you with simple and direct access to all non-emergency municipal government information, programs and services provided by the City of Brampton and Region of Peel.

You may call 311 anytime for anything from parking to garbage and recycling, to tax payments and water bills, to recreation programs and building permits, and so on.

For more information about this service, visit: http://www.brampton.ca/en/Info-Centre/Pages/311-Brampton.aspx

AVOID THE HST – Buy A Home Now!

The following appeared in the Brampton Guardian  today.

Avoid the HST – Buy a home now

The new harmonized sales tax being implemented in Ontario may end up being a friend of business but for consumers buying a new house prepare to be stung.

The HST will combine the current GST (5 per cent) and PST (8 per cent) to create one tax, HST at (13 per cent). This tax will apply to new homes and to many home closing costs, adding to the cost of a resale home and thousands to the cost of a brand new home.

Under the current system many of the services associated with the purchase of a resale home are only charged the 5 per cent GST. This means that mortgage insurance premiums, legal costs, real estate commissions, home inspections and title insurance will now all have an additional 8 per cent tax.

This chart, supplied by the Ontario Real Estate Association illustrates how closing costs on a resale home will be affected. (Based on a single detached home priced at $360,000.)

Table 1:

Taxable Service                             Current Tax Payable       New Taxes        HST Tax Payable

Mortgage Insurance Premiums      $752.40                            $470.25                   $1222.65

Legal Costs                                           $50                                     $80                         $130

Real Estate Fee/Commission            $720                                  $1,152.00                 $1,872.00

Home Inspection                                  $20.00                                $32.00                     $52.00

Title Insurance                                     $24.00                              $15.00                         $39.00

                             Total New Tax: $1,749.25-$2,325.25

 

The purchase of a new home will be hit even harder but thanks to lobbying efforts from many sources including the Home Builders Association and the Ontario Real Estate Association, the proposed HST on new homes will not be as severe as first proposed. The government has revised the rebate for new homes as 75 per cent of the provincial portion of the HST payable to a maximum rebate of $24,000. Originally the 75 per cent rebate only applied to houses under $400,000. This means an added tax of $6000 on a new $500,000 home. In May, as part of the Brampton Real Estate Boards Government Relations Advisory Council, we took our opposition to all of the MPPs in our area to ensure they understood the impact that this tax will have on homeowners and the real estate industry. The Brampton Real Estate Board opposes the HST because it will hurt the affordability of housing. You will pay significantly more to close on an existing home or to purchase a new home under the HST system that comes into effect in July 2010. So avoid the tax, if you are thinking of buying a home or moving up this year do it now and avoid the HST.

-Ruth Ballantyne

http://zoominlocal.com/ml-brampton-guardian/2010/01/13/#?article=722598

For more information on the new HST please visit: http://www.cra-arc.gc.ca/tx/bsnss/tpcs/gst-tps/menu-eng.html