Three Tips for First Time Buyers

As a first time buyer, you’re probably experiencing a mix of emotions — excitement and anxiety.

Don’t worry! Even the most seasoned buyers feel a bit anxious. We’ve all gotten a case of the dreaded buyer’s remorse… but this time it won’t be over a shirt or a pair of jeans. You don’t want to make any mistakes when purchasing a new home.

How can you avoid a mistake? As specialists in Toronto’s loft and condo market, we’ve helped many first time buyers find their perfect home. Here are our top 3 tips for first time buyers:

Establish your budget

The most common mistake for first time buyers is that they focus on big numbers like $300,000 or $450,000. Instead, you should begin by looking at your monthly budget.

A $450,000 purchase price may or may not translate into an affordable ‘monthly’ payment, and you should know the answer before looking at any properties.

How does one figure out their budget?


Look at your bills and other expenses. Weigh them against your income and establish what you can afford to put towards a mortgage on a monthly basis.

As a general rule, your annual mortgage payments and carrying costs should not exceed more than about 1/3 of your annual salary.

If these costs are more than one third of your salary, you risk stretching yourself too thin financially.


Find a mortgage broker that you can trust. A good mortgage broker is indispensable because they work independently of any one particular lender. They will look at dozens of lending products and select the best one for you.

This is a great advantage over going to a bank because banks only promote a handful of their own mortgage products.

Also, mortgage brokers are compensated by the lender that you select. You don’t pay any fees for their services (just like working with a realtor, who is compensated by the seller).

Know Your Closing Costs

Be sure to calculate these in advance. For first time buyers, they tend to be about .5% to 1% of your purchase price. That is very low — compared to a regular purchaser who pays about 2.5% in closing costs.

A good realtor will recommend a handful of contacts, from lawyers to mortgage brokers to moving companies.

All of these contacts should range in price to fit most budgets, but range very little in terms of service quality.

Hire the Right

Realtor Your realtor should know the areas and properties you’re looking for. If you’re looking for a loft in Toronto, don’t hire your best buddy from Thornhill. He or she will only have a vague sense of the market value in Toronto and sellers DO NOT always make a habit of pricing their properties at fair market value. What sellers do make a habit of doing, is hiring agents who are experts at convincing buyers of the “legitimacy” of their purchase price — whether true, exaggerated or plainly false.

You’ll literally save thousands of dollars and potentially avoid buying a lemon if you hire an agent that knows the local market and inventory you’re looking for. That agent will ultimately use their knowledge as leverage when negotiating on your behalf.

Local, full-time realtors should also know the properties intimately. If you were to ask any of us at about a particular loft, we could tell you if the building’s managed well, has poor sound insulation, is about to undergo a major renovation, and much more. The true value a strong realtor should bring to the table is knowledge of the intangibles — information that is hard to come by.

There is certainly more to buying a property. However, if you follow these 3 tips, you’ll be way ahead of most!

If you’re looking for a condo or loft in downtown or midtown Toronto, that’s certainly our area of expertise. Contact us — we’d be happy to help out! Team

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