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Minimum costs for buying a home

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Knowing the minimum costs of a home acquisition can help first time buyers gain confidence in their decision to purchase, and stay within their budget during the house-hunt.  Here’s a quick and easy way of calculating how much you need to be earning and saving to comfortably buy a home: as a rule of thumb it’s recommended that home ownerships costs should consume no more than 33% of your monthly income. Financial institutions will also follow more or less the same guideline when approving you for a loan. So your monthly salary should be at around 3 times greater than your total monthly mortgage costs + taxes and bills. 

Let’s look at 3 properties at 3 different price brackets and how much cash you would need to invest in them.

1. A condo in the Southwest at $209,000 

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What you can find at that price range:
It’s almost impossible to find a decent condo on Montreal Island for less than $250,000. But occasionally, gems like this one pop up in the South West or in Rosemont. At $200,000 – 250,000 you’ll find a one bedroom condo, most likely without a garage.

How much you need in the bank for immediate expenses:
Downpayment (5%): 10,450
Mortgage Insurance Taxes: $713
Land Transfer Tax$: 1,840
Notary fees: $1,000
Title insurance: $209
Total Cash Required: $14,212

How much you’ll have to pay per month:
Mortgage payment: $910
Property Tax: $165
Utilities: $300
Property insurance: $50
Phone: $40
Cable: $60
Internet: $45
Total: $1,571

Recommended Annual Income: 56,000, or $28,000 each for couples. 

2. A Griffintown condo at $300,000 

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See more about this condo >>

What you can find at that price range:
A spacious 1 bedroom with a garage or a 2 bedroom condo in the Southwest or Rosemont. You’d be hard pressed to find even a one bedroom at this price in the Downtown core or in the Plateau, and if you do it will probably be on the smaller side. Alternatively, you could find a bigger/better condo out in Pointe St Charles, St Henri or Verdun.

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How much you need in the bank for immediate expenses:
Down payment: $15,000
PST on mortgage insurance: $1,023
Land Transfer Tax: $3,000
Notary fees: $1,000
Title insurance: $300
Total Cash Required: $20,323


How much you’ll have to pay per month:
Mortgage payment: $1,307
Property Tax: $238
Utilities: $300
Property insurance: $50
Phone: $40
Cable: $60
Internet: $45
Total: $2,039

Recommended Annual Income: 70,000, or $35,000 each for couples. 

3. A single family home for $400,000

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See more >>

What you can find at that price range:
For 400,000 -450,00 you can find a decent sized condo in the Downtown core or a single family home in NDG or the suburbs.

How much you need in the bank for immediate expenses:
Down payment: $20,000
PST on mortgage insurance: $1,365
Land Transfer Tax$: 4,500
Lawyer fees: $1,000
Title insurance: $400
Total Cash Required: $27,265

How much you’ll have to pay per month:
Mortgage payment: $1,742
Property Tax: $317
Utilities: $300
Property insurance: $50
Phone: $40
Cable: $60
Internet: $45
Total: $2,554

Recommended Annual Income: 90,000, or $45,000 each for couples. 

*All these calculations were made based on a 25 year amortization period, at 5% down and with a 2.39% interest rate (today’s lowest rate). Keep in mind that these are just estimates and will vary based on the conditions of your lender and on your choice of mortgage plan. Please contact your financial institution for an accurate quote*

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