First Time Homebuyers: What I've (we've) learned so far

To bring you up to speed - Michelle put a deposit on a condo well before we were serious - and now, after almost a year of living together (renting) - the condo is nearing completion, and it will now be a joint purchase. So, what is it REALLY like for first time homebuyers buying one of those "dreaded" condos in that "expensive city"?

Our building - about a month ago

Well, I guess we don't really know yet - since we're still watching them put the roof on, but after several angry meetings, and delays (delays which I might add actually worked out for Michelle and I) - we're getting close.

What we've done so far...

• We've bought appliances - the condo came with a dishwasher (which we upgraded), and we just matched our purchased appliances to that. Most of the appliances they offered through the builder were either too expensive, not to our taste, or both. So long as you're willing to do the work - this can save you a ton
• Saved. With all the mortgage rules changing around CMHC insured mortgages (which you have to get
  
  if you put down less than 20% - see here if you're interested), we've been able to tune it out. Between Michelle (who's for just cause, saved a lot more than me) and I, we have above and beyond the 20% down payment for the condo. Not that there's anything wrong with the CMHC mortgages - Michelle was going to get one in the first place, but...there's a reason why they've put so many restrictions on them lately: it's very easy to get a false sense of being able to afford something. Sure - saving isn't the most fun, or easy thing to do in your 20's, but it's well worth it, knowing that our mortgage payments will be lower, we don't have to pay for mortgage insurance (which is a requirement for CMHC mortgages), and we don't have to go into any more debt than we have to.
• Calculated our occupancy costs... Another reason why we're happy to be putting down 20% is that our occupany costs will be lower. Maybe some of you don't know, but when you buy a new condo, you CAN'T technically own it, until all units are moved in, and the building gets registered as a condo by the city. In the meantime, you pay what some people call 'rent' - but it's more calculated than that - you're basically just paying the interest on your outstanding balance (based on prime rates of a 1 year mortgage), plus your usual maintenance fees. So, the more you have down by this time, the better.
• ...and our Closing Costs. These were a doozy - between finding a decent lawyer - and figuring out all of the "expensive" land transfer taxes, we were worried. But, in Toronto, your LTT on your first home of $400,000 or less are waved...so...don't have to worry about that. All together, we're looking at well under $5,000. Don't quote me on that though...we're cheap, so we found ways to cut back wherever we could. 

  

  Examples of some normal closing costs...ours will be
  much lower...only because we have lower LTT, and HST is
  already accounted for

• Come up with an agreement - to protect ourselves. Michelle and I are too practical to go into
  
  something with tens of thousands of dollars of our own money, without putting something together to protect it. It sounds like we plan on breaking up, but, until something more permanent comes (like marriage) - it only makes sense. It was awkward at first, but when we thought about things aside from just a breakup, like if something were to (knock on wood) happen to either of us - it'd be nice for us to decide our own investment's fate. So - after doing some searching - we decided to draft a cohabitation agreement, which we'll both sign and have notarized. Necessary? Probably not. Unnecessary  Definitely not.
• Made a BUDGET! Buying a new home comes with the costs of buying new stuff, doing some renovations, etc. It adds up fast - I'm sure. Hell - we rent right now - and still buy new stuff for the place. So - we set budgets and prioritized - and while we still get our backsplash, den doors, and kitchen island - we'll be cutting back on things like new faucets and a new shower head - at least until we can get a better handle on our finances.

The main thing is for us is to make sure we always have more money than we need, because the last thing we want to do is end up on some Gail Vaz-Oxlade show - using cash out of jars. So - I think I'm okay with keeping the standard faucets for a while...

More to come I guess - as we get closer and closer to moving in!