We've heard a lot of Potential Buyers, including First Time Buyers, talking about how difficult it is to save up a down payment let alone buy a home. Buying a home is the same as it was years ago, it takes patience and discipline but it is possible.
You may have school debt, high rent costs, and other expenses, but by making some small changes, you can save for a down payment.
- Create a budget. Look at your expenses and ask yourself: What are you willing to give up? If there is nothing you are willing to give up, what are you willing to do to earn some extra income? There are many options to earn extra on the side! Download this free Home Savings template in Excel (download link coming soon) directly from our secure website here. You will need to enter your own numbers, but it’s all laid out for you. You can use the mortgage calculator here to help you.
- Saving for a down payment is similar to purchasing a car. The difference is that with a car, you have it first, but by the end of the payments, its value has significantly depreciated. In contrast, when you buy a home, its value typically increases each year.
- Calculate and check the cost of all your subscriptions. Do you use them all? Have you subscribed to a channel to watch a specific show and forgotten to cancel when it ended? Remember to check all those business apps you pay for too. Do you use them, enough to make them work the cost, are there any you can live without? If not, can you scale back or take a break? TIP: Immediately after you sign up, unsubscribe from the trial or the required months of any apps that you may not want so you don’t forget.
- Make your own meals. There is no doubt about it, groceries are expensive lately, if you are eating out or using delivery services like Skip the Dishes and Uber Eats, you are paying a premium on top of a premium! Sure, It's super convenient but is the cost worth it? Take the time to calculate the average monthly costs of eating out and getting delivery vs home prepared meals and multiply them by 12 months, then by 5 years, you may be shocked at the amount you are spending.
- Start a Side Hustle! Do you have a skill or talent? Whether it's gardening, lawn care for neighbors, creating customized mugs or hair bows, or even professional gift wrapping during the Christmas season, there are plenty of opportunities. Can you create logos or brochures? Try advertising on Facebook Marketplace to see who responds.
- Borrow if You Can. Are you a proven responsible individual? It's possible that your parents, grandparents, or another family member will provide a loan or even an early inheritance. It never hurts to have the conversation, and it could really give you a step up in home ownership. Keep in mind that the funds will need to be in your account for a minimum of three months to be allowed as a down payment by your financial institution.
- Sell things you don't need—it will make packing for your move much easier! Do you even play those video games? What about that popular book series? Will you ever read it again? Probably not. Sell them on Kijiji or Facebook Marketplace! Save the money or use it for things you want while keeping your savings intact.
- Hustle and don't waste time. Take those extra shifts offered at work, stay late, and go in early. What would you be doing instead? Playing on your phone or watching mindless TV? Don't overdo it and burn yourself out; take time to reward your hard work, save, and enjoy yourself.
- Check out CMHC.ca and your local municipality for help. Many cities or municipalities have down payment programs you may qualify for. Learn more here.
- Keep it safe! Place the funds in a term investment where it will grow and remain inaccessible, ensuring you don't spend the money you've saved.
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