The Annual TD Canada Trust First Time Homebuyers Report is out, and has discovered that first time buyers in Canada are far less prepared for homeownership than they were last year.
For example, only 76 per cent of Canadians who bought a home within the last two years or are planning on buying their first home within two years got themselves pre-approved for a mortgage before they started looking at homes. That’s down from 91 per cent of first time buyers who made sure they were pre-approved last year.
Mortgage pre-approval is important for home buyers, because it gives you a better idea of what you can afford. It lets sellers know you are able to make concrete offers on a home, and prevents everyone from being disappointed when you can’t get financing later on.
In addition to the drop in the number of first-timers getting approved for mortgages, almost every aspect of researching the home buying process has decreased from 2010.
Fewer first-time home buyers are speaking to a mortgage lender to prepare for homeownership, estimating annual maintenance costs, calculating closing costs, learning about their mortgage options ahead of time or estimating their heating, electricity and water bills. The largest decline was the first time home buyers arranging for a home inspection, dropping to 67 per cent in 2011 from 85 per cent in 2010.
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