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First-time buyers can still get in market says Maple Ridge realtor

Mortgage broker said government must do more to help first timers
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Rebecca Awram, a local real estate broker, lauds a new way for first-time buyers to save in the First Home Savings Account. (Neil Corbett/The News)

The Maple Ridge News has been looking at the issue of affordable housing in the series Crisis at Home. In this sixth installment, we look at first-time buyers who are able to get into the market, and advice from longtime local real estate professionals who say home ownership is still a goal worth pursuing.

There are still first-time buyers able to navigate the perils of the housing crisis and get into the real estate market.

Ron Antalek started as a realtor more than 30 years ago in Maple Ridge, giving up a teaching career because he loved helping people get into their first home.

“It was very fulfilling and enjoyable – it was so rewarding,” he said.

So it’s discouraging for him to hear the results of a recent poll saying the majority of people who don’t have a home have given up on ownership. High prices have meant they need bigger down payments, it’s harder to qualify for a mortgage, and high rental prices and inflation makes it tough to save money.

“They have a hard time saving – many first-time buyers have family support now,” said Antalek.

There was no family support for Emily, who recently purchased a new two-bedroom condo in the new Inspire complex. She had to sacrifice.

“I have been saving money every paycheck for over 10 years, I have not gone on vacations or made any large purchases, as I knew the time would come and I would need to have a substantial down payment,” she said.

And that’s her simple advice to would-be homeowners.

“Save, save, save – the most important thing is to make sure you have at least 20 per cent you can put down.”

Legally, buyers need to have five per cent down for a purchase of $500,000 or less, plus 10 per cent of the portion of a purchase price over $500,000. So a $600,000 property would require $35,000 down.

However, if you don’t have a 20 per cent down payment, as Emily recommends, or have poor credit history, you may need to purchase mortgage loan insurance, which will add to your monthly payment.

Rebecca Awram is a mortgage broker with offices in Maple Ridge, who said move-up buyers and investors now make up more of her business than in the past. She sees some first-time buyers, but most are purchasing east of the city.

Awram blames misguided government policies for sidelining first-time buyers.

“You can look backward over policy of the last 10 years, of all levels of government, have been designed to try and reduce demand instead of trying to increase supply,” she said.

Amortization periods have been reduced, and mortgage qualification made more stringent.

“If you’re an existing homeowner, those things are relatively easy to deal with, in an escalating environment. If you’re a first-time buyer, they’re not.”

She sees an economy where, just as home ownership can be passed from parents to children, “rentership” will also be passed on.

“You need policies specifically designed for first-time buyers to get them in the market,” maintains Awram.

READ ALSO: Housing minister tells Maple Ridge summit ideas to add more units

She said there is a new incentive program that could help more first-time buyers get in the game, in the First Home Savings Account (FHSA), which started April 1 this year.

“This one I actually like,” she said. “But again, it assumes you have money to save.”

It is similar to the Home Buyers Plan, which allowed purchasers to withdraw funds from their RRSPs to buy a home.

The new FHSA program also allows purchasers to save for a down payment with tax credits, just like an RRSP, but they are not required to repay the withdrawal.

They can contribute a maximum of $8,000 per year, to a limit of $40,000. If they don’t contribute the full $8,000 per year, the unused contribution limit carries over to the next year.

She said young people who are looking to buy a home should get started with the FHSA as soon as possible. That will get them started toward their $40,000 limit. If they come into a sum of money, they can put it into their home savings tax shelter.

“Everyone should be rushing out to open up one of these things right now,” she said. “Put $100 in it – just get it open.”

Awram is a believer in home ownership, and said buying a home at a young age shaped her life.

“I eat what I cook – I believe in real estate wholeheartedly,” she said. “Home ownership is the soundest thing people can do for their financial security and for their children.”

She would like to see governments make it easier for first-time buyers to get in the market, with policies like longer amortization periods – what she calls “Bite now, chew later.”

In 1989, when Antalek started working as a realtor, prices were under $100,000 for a single family home in Maple Ridge. He has watched those houses he sold in 1989 become million-dollar homes, and said he still believes in real estate.

He gives kudos to the city of Maple Ridge for its Housing Affordability Summit, and said it underlined the main issue – inventory.

“It’s supply and demand, and more supply is the absolute requirement to ever get to affordable housing,” he said.

But the lack of inventory is also why he doesn’t see any real estate bubble that is about to burst. The housing market just came through the pressure test of COVID-19, then rapidly rising interest rates, and remains resilient.

“May was one of the hottest markets in a year,” said Antalek.

The big difference between now and 1989, is first-time buyers won’t be looking for their dream home. They will likely need to move up from a condo, to a townhouse, to a house, building equity along the way.

“Home ownership is still viable, and it’s still a great investment,” said Antalek.

READ ALSO: Housing crisis pushes more B.C. workers to add side hustles


Have a story tip? Email: ncorbett@mapleridgenews.com
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Neil Corbett

About the Author: Neil Corbett

I have been a journalist for more than 30 years, the past decade with the Maple Ridge-Pitt Meadows News.
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