Take Advantage!

by Darrin DeRoches February 2 - 8, 2012

I may sound like a broken record talking about out of town buyers – again – but a new young client has a new perspective on the real estate market in Hamilton. The first scenario is a young couple who have been transferred by a pharmaceutical company to Hamilton and they are considering renting or buying. They have no idea what Hamilton has to offer and are putting their total trust in me. They believe they should rent first and get a lay of the land and then consider buying in the near future. I understand their concerns in jumping into the real estate market too fast, but after a short conversation I convince them to consider buying.     The boyfriend wants to buy and the girlfriend wants to rent. She has just finished university and is applying to Mohawk for more courses so she believes renting is the safe bet. I ask her what she currently pays in rent and how much she is comfortable paying here in Hamilton. She pays about $1,000 a month and is willing to go up to $1,400 for the right two–bedroom apartment. I send her listing for apartments in the West End of the city and steer her closer to the Aberdeen and Dundurn area.  Great apartments from $1,100 to $1,400 a month for a two–bedroom. She likes them and also asks about small homes or condos. I then send her a bunch of listings from $150,000 to $250,000 for single family homes in the same area. The boyfriend likes them, but she is still hesitant about buying and is afraid they cannot afford a home.     I then send her a breakdown of costs, five percent down, first time buyer credits and closing costs. The interesting part in today’s market is that this couple can not only afford to buy a home it will cost them less than renting. A $250,000 dollar home with the 2.99 percent,  four–year term will cost them about $1,100 a month and with taxes it will fall in the $1,400 a month comfort zone. If they were to buy a home in the $200,000 range it will cost them a couple of hundred dollars less. The 5 percent down is about $10,000 dollars but if they rented for the year it would cost them about $17,000 dollars. Take this into consideration and then they could also consider a mortgage that allows a first time buyer to get a five percent cash–back on their mortgage it seems even more enticing.      I left all the information with the young couple and they are not only looking to buy in our great city, they are even considering on buying an income property so someone else can help pay their mortgage. So if you have good credit and are considering on buying or currently rent – take advantage of the low rates, give us a call and we will align you with the right people. Numbers don’t lie and greed is good! V         Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at mail@uniquerealty.ca.