For generations, it was taboo to talk about money. Going public with financial goals or budgeting was not something people did. As the cost of living continues to rise, it’s more important than ever to be intentional with financial literacy. A new social media trend referred to as ‘loud budgeting’ has gained traction, defined as “a strategy designed to put your money aspirations at the forefront for friends and family to see and hear,” according to an article published by TD.
Buying a home is consistently labelled as the largest, most expensive purchase you will ever make. So if it’s common practice to budget your monthly spending for necessities like groceries, insurance, and streaming subscriptions, it’s a must to plan for entering the real estate market or making moves within the real estate market. And the same loud budgeting principles can apply.
Planning doesn’t stop with a downpayment (though that’s a major milestone to reach!) Closing costs, mortgage payments, utility bills, insurance, property taxes, repairs and renovations, condo fees (where applicable) must be considered, too.
I am not a financial advisor. But as a realtor and someone whose personal real estate goals came to fruition via conscious decision-making and seeking out resources, I’m sharing some tools in hopes that something may resonate to inspire and empower you to take the leap.
Shift your mindset: Younger generations are inundated with evidence that home ownership has grown out of reach… set up to fail, facing world crisis after world crisis and doomsday headlines, shamed for buying $9 lattes and $18 avocado toast. Some people think it is too late, while others regret not taking action sooner. Other generations may feel stuck in that they want to sell their house but feel they will overpay for the next place and get less in today’s market. Today’s the day to make the choice that a narrative like these no longer applies to you. Begin envisioning yourself as a homeowner (in whatever capacity) and know your ‘why’. Are you purchasing real estate because you are wanting a place to call home, to invest in yourself? Are you downsizing in order to afford yourself more freedom to travel? Do you dream of having land for your dog to run free?
Adjust your expectations: Sometimes the way to afford a single family home is to buy a one bedroom condo now, pay down the mortgage and build equity for 5 years, then use that equity (hopefully some appreciation too) to move up when the time is right. A common theme we’ve seen in the past few years is renters waiting to buy until they can afford more or until the interest rates drop. Unfortunately, prices have increased faster than they can save. Taking action to enter the market is often a more powerful tool than waiting and hoping.
Soak it up: Make like a sponge and learn all you can. Resources are infinite, whether it be books, webinars, following qualified and trusted voices on social media, connecting with qualified professionals. Get in touch with a good realtor and start following the market in your city. Research strategies others have used and apply critical thinking to explore if these options could work for you (house hacking, having basement tenants, or operating an Airbnb works for some people but there are real implications depending on your motivations). Walk the dog through neighbourhoods, take note of building styles and lifestyle considerations and start imagining your life there.
Understand the numbers: Use mortgage calculators or connect with a great mortgage broker or someone at your financial institution of choice, know your target and check in on your progress regularly, contrast actual costs to rent payments, learn about mortgage insurance and the possibility of a lower downpayment than the commonly understood 20% (For primary residences under $1.5 million, you can put less than 20% down but it triggers a mortgage loan insurance typically referred to as CMHC insurance. Secondary properties as well as properties over $1.5 million require a minimum of 20% down).
Our team likes real-life, practical examples so here’s what a downpayment and estimated property taxes look like at various price points:
| Purchase Price | $350,000 | $600,000 | $999,000 | $1,200,000 | $1,500,000 |
| 5% Downpayment | $17,500 | $30,000 | $49,950 | $60,000 | n/a |
| 10% Downpayment | $35,000 | $60,000 | $99,900 | $120,000 | n/a |
| 20% Downpayment | $70,000 | $120,000 | $199,800 | $240,000 | $300,000 |
| Estimated Property Taxes | $2,143 | $3,675 | $6,119 | $7,350 | $9,188 |
Automate your savings: Open a Tax Free Savings Account or First Home Savings Account, label it Downpayment or Welcome to my Crib or whatever inspires you daily, and automate regular contributions based on your timeline and $ availability. For quick math, a conservative estimate: if you put $500/month into a TFSA invested in an index fund that returns an average of 5% a year, that adds up to $6,300 after one year, $12,915 after two years, $19,860 after three years thanks to compound interest.
Ask for help: Have the conversation. Ask family members for help if it’s available to you. These are hard conversations to have but it could be a difference maker. According to a study by CIBC in June 2024, “31% of first-time home buyers received financial support from family, an increase from 20% in 2015. Financial support currently averages $115,000.”
Accountability: Surround yourself with people doing the same things or thinking the same way. Tell those you know and trust what you’re working towards. Set up meetings with your real estate agent or mortgage broker to inspire yourself to stay on track. Refer back to your ‘why’ on a regular basis and adjust if it has evolved.
Prompts: Maybe it’s a white board with a thermometer tracking your progress, a vision board with pictures of your favourite houses, a lipstick outline of a house on the bathroom mirror, a mug with your favourite inspirational quote, whatever works for you, do it.
We work with buyers and sellers at all ages and stages of their homeownership journey. We are always here to bounce around ideas and numbers so if you or someone you know (maybe your adult kid still living in the basement?) wants to start working toward home ownership, for the first time or in a different capacity, let’s talk about ways to get the ball rolling.
