Real Estate

How much do you really need to buy a house/condo ?

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  • Sep 2nd, 2015 9:25 am
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[OP]
Member
Mar 14, 2015
242 posts
25 upvotes
Winnipeg, MB

How much do you really need to buy a house/condo ?

Recent grad living at home (moved back after going to school in another province). I will be grossing ~60-70k annually with small raises each year.

I have ~30k in debt from school, should not take long to pay off as I have minimal expenses. I'm hoping to pay it all off and start saving up for my own place (likely a condo) for mid-late 2017. If I was to be looking at a condo around 250k and have 50k for a downpayment to make 20%, how much more on top does one really need to expect? Obviously things like furniture, other fees/expenses, living costs and necessities, emergency funds.

for a 250k condo, would I essentially need 100k before its even worth considering the plunge?


To note; I live in Winnipeg, our housing market is nothing like the big cities in Ontario and BC
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Apr 11, 2008
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MRIGuy wrote: Recent grad living at home (moved back after going to school in another province). I will be grossing ~60-70k annually with small raises each year.

I have ~30k in debt from school, should not take long to pay off as I have minimal expenses. I'm hoping to pay it all off and start saving up for my own place (likely a condo) for mid-late 2017. If I was to be looking at a condo around 250k and have 50k for a downpayment to make 20%, how much more on top does one really need to expect? Obviously things like furniture, other fees/expenses, living costs and necessities, emergency funds.

for a 250k condo, would I essentially need 100k before its even worth considering the plunge?


To note; I live in Winnipeg, our housing market is nothing like the big cities in Ontario and BC
It's really a personal choice. I have known people who own million dollar houses and have no furniture. They rent out every room of their houses too.

In general, you will need to account for closing cost (different for different cities) and property taxes. Some people also recommend budgeting 1-3% for maintenance, but I wouldn't for new condos.

You don't need 20% down payment to buy a condo. It's again a personal choice.
Deal Guru
Feb 29, 2008
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You don't need 20% down, however it's good to have 20% down because you won't have to pay CMHC.

If it's a new condo then you will have some extra costs at closing. Not sure how things work in Winnipeg but in a city like Toronto we have to pay land transfer tax. 1st time home buyers do get a bit of a credit, though...(not sure how much). There's also a bunch of hidden costs if you buy new like levies fees and lawyer fees on top of that.

I'd say keep an extra 3%.

Furniture can get up there in price but you don't have to get everything right away. Buy the essentials first and then gradually add the rest. I think there's an EQ3 outlet in Winnipeg. You should be able to find some good deals. Then there's ikea of course.

I'd say you could furnish your entire place (1 bedroom apartment?) for well under $5K.
[OP]
Member
Mar 14, 2015
242 posts
25 upvotes
Winnipeg, MB
Thanks guys. I'd like 20%, but if I want it by the end of 2017 its not overly likely to get 20% and some on top, so maybe I'll hopefully get up to 30-35% of the cost of the condo saved up and only put 19-15% down so I still have the extra wiggle room for other things.

It wont be a new build, likely 2BR ideally, if I found a 3BR in the neighborhoods I want at a good deal I'd go after it.
[OP]
Member
Mar 14, 2015
242 posts
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Winnipeg, MB
CalgaryExotics wrote: have a roommate to pay some of your mortgage.
I'd pass. I'm buying my own place so I don't have to live with other people who I don't want to live with
Deal Addict
Nov 13, 2012
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MRIGuy wrote: I'd pass. I'm buying my own place so I don't have to live with other people who I don't want to live with
Fair enough. I would buy a house with a suite and rent either the bottom or top. That way the renters basically pay your mortgage.
Deal Addict
Jul 11, 2010
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As you will be requiring a mortgage make sure you build your credit up over the next 2 years. You did not mention if you have any credit cards or lines of credit. Lenders will want to see 2 trade lines. Use the line of credits or credit cards but make sure that you make payments each month and before the due date. With a good job, and little debt and a good down payment you should be in good shape. You mentioned saving up to 34% of the units costs. If you are at 19% for the down payment then use some of the savings to take you to the 20% amount. As mentioned above this will save the CMHC fees.
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Aren't the CMHC fees with 19% down almost negligible? It's the people putting 5% down who have huge CMHC fees. Or am I mistaken?
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Deal Guru
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CalgaryExotics wrote: Fair enough. I would buy a house with a suite and rent either the bottom or top. That way the renters basically pay your mortgage.
This is by far the quickest way to financial bliss. I'd do this if only my girlfriend was onboard.
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Nov 13, 2012
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JayLove06 wrote: This is by far the quickest way to financial bliss. I'd do this if only my girlfriend was onboard.
why wouldn't she be on board? someone will pay off your debt and you live for free lol.
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CalgaryExotics wrote: why wouldn't she be on board? someone will pay off your debt and you live for free lol.
Because it's not about paying off mortgage as fast as possible to many people.. what's the advantage?

Its like you can pay it off sooner if you go on a diet of ramen and cornflakes and work 3 jobs... But that choice is not palatable to many people

I don't see what's this obsession with paying off mortgage or debts ..as long as you can service your debt and have comfortable cash flow for desired lifestyle..it really is inconsequential if you pay off mortgage in 30 yrs or 25 yrs
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Nov 13, 2012
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LandKing wrote: Because it's not about paying off mortgage as fast as possible to many people.. what's the advantage?

Its like you can pay it off sooner if you go on a diet of ramen and cornflakes and work 3 jobs... But that choice is not palatable to many people

I don't see what's this obsession with paying off mortgage or debts ..as long as you can service your debt and have comfortable cash flow for desired lifestyle..it really is inconsequential if you pay off mortgage in 30 yrs or 25 yrs
because there is a very small percentage of people that are smart and ambitious. They want to build their net worth. Many people with the philosophy of a suite are real estate investors with multiple rental propterties. If you just want to get by and live paycheque to to pay thats fine. However someone people wanna get ahead. Some people want to be able to retire at 40 because they had financial bliss.
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CalgaryExotics wrote: because there is a very small percentage of people that are smart and ambitious. They want to build their net worth. Many people with the philosophy of a suite are real estate investors with multiple rental propterties. If you just want to get by and live paycheque to to pay thats fine. However someone people wanna get ahead. Some people want to be able to retire at 40 because they had financial bliss.
You don't get ahead by living like a refugee...or rephrase..what's the point of "ahead" of you live like a refugee in a rooming house?

Ok so say you have an extra 50k in your bank account...but you eat ramen and cornflakes and don't take vacations and rent out two floors of your house

What do u hope to accomplish for being "ahead'? The ability to live like a homeless person?
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LandKing wrote: You don't get ahead by living like a refugee...or rephrase..what's the point of "ahead" of you live like a refugee in a rooming house?

Ok so say you have an extra 50k in your bank account...but you eat ramen and cornflakes and don't take vacations and rent out two floors of your house

What do u hope to accomplish for being "ahead'? The ability to live like a homeless person?
You don't live like a homeless person. You create two living places out of one house. Most people don't use their basement anyways. And plus you have a separate entry,laundry, kitchen and bathrooms. The other tenants have no access to you.

Im not saying live like someone poor. But building wealth is a game, and the people that do it enjoy the challenges.
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Jan 13, 2012
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Let me impart this advice, and I know this goes against everything RFD stands for, but...

Bare minimum down payment.

Do not, I repeat, do NOT become cash poor buying a house.

When the inevitable "ooh poop" happens, you want to be able to cover it.


The $1-2k or so you save over twenty-five years (from not paying cmhc with a 20% down) isn't worth sacrificing basic enjoyment of life.

There are other things in life besides your net worth.

Trust me. I learned the hard way.
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Sep 21, 2007
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Hey fellow Winnipeger. I'm looking to buy in the next two years as well. We are overbuilt here though.. market might dip a bit.
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CalgaryExotics wrote: You don't live like a homeless person. You create two living places out of one house. Most people don't use their basement anyways. And plus you have a separate entry,laundry, kitchen and bathrooms. The other tenants have no access to you.

Im not saying live like someone poor. But building wealth is a game, and the people that do it enjoy the challenges.
So you break the law, overburden your community's infrastructure, and turn your neighborhood into a slum just to be able to afford a property you bought outside your means? That's disgraceful.


Actually, what's even more disgraceful is that the government apparently considers this transparent rent-seeking an 'affordable housing' strategy, even though it raises prices for everyone else who actually wants to buy a house to live in just for themselves.

http://www.cmhc-schl.gc.ca/en/inpr/afho ... su_001.cfm

A bunch of idiots running this country.
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Jun 12, 2007
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GTA
CalgaryExotics wrote: Fair enough. I would buy a house with a suite and rent either the bottom or top. That way the renters basically pay your mortgage.
If the cash from renting the basement is enough to cover the mortgage for the entire house, why wouldn't the tenants just get a mortgage of their own and live in their own house instead of your basement?
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NuclearBlast wrote: If the cash from renting the basement is enough to cover the mortgage for the entire house, why wouldn't the tenants just get a mortgage of their own and live in their own house instead of your basement?
Not everybody can save up a $100,000+ downpayment so the mortgage payments are less than the rent.
Just because you can doesn't mean you should.

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