February 26, 2013

Buying a first house was never so appealing

Government incentives, such as tax credits or a $10,000 handout for first-time buyers, make it easier than ever to make the commitment

Peter Simpson

We all remember the first time. Awkwardness. Apprehension. Racing heart. What if I don’t get it right? Yep, losing one’s property virginity ranks as one of life’s most memorable milestones. I was in my early 20s when I purchased my first house, an experience I have chronicled in previous columns. Apart from a couple of sleepless nights after I signed on the dotted line way back in the ’60s, I have never regretted the decision to wave goodbye to landlords and embrace home ownership.

There have, of course, been the occasional stumbling blocks along the way, such as in 1981 when I struggled with a crippling 21-per-cent mortgage. Today, some five-year mortgage rates are under three per cent. I wish I knew then what I know now. Youthful exuberance helped override my fears, and I jumped on to the first rung of the property ladder without learning how to make informed purchase decisions.

There were no Home Ownership 101 courses in which to enrol. Many of my peers and I knew precious little about legal considerations, closing costs, mortgage options or warranties. One of the first things I did when I joined the Greater Vancouver Home Builders’ Association was to launch this region’s first comprehensive seminar for first-time homebuyers. The annual seminar has helped to demystify the homebuying process for more than 14,500 first-timers over the past 18 years. Young men and women who attended previous seminars occasionally contact me to reflect positively on their experiences. All of them gained a measure of confidence.

This made-in-Canada seminar won an Ideas in Education Award from the Washington D.C.-based National Association of Home Builders, besting 24 competing American entries (easily, from what I was told). How’s that for cross-border bragging rights? Anyway, the GVHBA’s 19th annual seminar will be held from 7 to 9 p.m. on Tuesday, March 19 at the Bell Performing Arts Centre, 6250 144 St. in Surrey. Doors open at 6 p.m. to allow ample time to view builder displays and other home-related products and services, and chat with industry experts.

Thanks to generous sponsors, admission is free. The Homeowner Protection Office branch of BC Housing is the presenting sponsor, while Dominion Macklem Mortgages is the patron sponsor. Corporate sponsors are The Vancouver Sun, The Province, Glacier Media Group, Canada Mortgage and Housing Corp., Real Estate Board of Greater Vancouver, Genworth Financial Canada, National Home Warranty, FortisBC, CKNW, 99.3 The Fox, AM730 and Classic Rock 101.

Speakers are Robyn Adamache, CMHC; Narrinder Dhanoya-Bhangu, Genworth Financial Canada; Tom Reeves, National Home Warranty; Gregory van Popta, McQuarrie Hunter LLP; Sandra Wyant, REBGV; Bill Macklem, Dominion Macklem Mortgages; Michael Liu, FortisBC. Seminar moderator is Shayne Ramsay, CEO of BC Housing.

I have been told that prospective first-time homebuyers have been sitting on the fence lately, unsure of whether or not they should, or can afford to, take the purchase plunge. As we all know, there are affordability issues at play in this region, but builders seem to be sharpening their pencils these days.

And if the Bank of Mom and Dad has been tapped out, there are many financial incentives specifically designed for first-time homebuyers. The provincial government offers two incentives. One is a first-time homebuyers’ bonus of up to $10,000 on new homes (expires March 31). The second is an exemption of the property transfer tax on new or resale homes priced up to $425,000.

The federal government also lends a hand, offering a first-time homebuyers’ tax credit of $750. And if you have managed to contribute to an RRSP account, you are allowed to withdraw, tax free, $25,000 to apply toward a down payment. The withdrawal must be replaced over a 15-year period. Speak with your builder, realtor, mortgage broker or lawyer to find out if you qualify. Now you can see why the seminar for first-time homebuyers is so popular, year after year.

Pre-registration is required. Register online at www.gvhba.org or call 778-565-4288.

There is plenty of free parking and public transit is at the door. Although admission is free, please consider bringing one or two non-perishable food items for the Surrey Food Bank, which helps to feed and clothe families all year, not just during the holidays. If shift work or prior commitments prevent you from attending the seminar, CMHC offers two useful tools to help homebuyers make informed decisions. The first is a debt-service calculator that “allows buyers to evaluate their financial situation and understand how much they can comfortably afford to spend on a mortgage.” (Visit www.cmhc.ca and search ‘calculator’.)

The second tool is a mobile app that “provides consumers, especially first-time homebuyers, with comprehensive CMHC information and tools.” The Ready, Set, Home app — a free application that offers quick and convenient access to CMHC housing data — can be downloaded to a variety of electronic devices at www.cmhc.ca/mobile.

Peter Simpson is the former president and chief executive officer of the Greater Vancouver Home Builders’ Association. Email peter_simpson@hotmail.com.

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