Ads keep this website free for you. does not research or endorse any product or service appearing in ads on this site.  Before making a major financial decision you  should consult a qualified professional.

Buy a Home
Canadian Tax and
Financial Information

If you use an ad blocker, please consider a small contribution to help keep free for everyone.

Need an accounting, tax or financial advisor? Look in our Directory.  Use above search box to easily find your topic!   Stay Connected with!
What's New
Personal Tax
Sales Taxes
Financial Freedom
Financial Planning
Real Estate
British Columbia
Atlantic Provinces
Federal Budget
Prov/Terr Budgets
Statistics etc.
Site Map
Advertise With Us
Contact Us/About Us
Links & Resources
Free In 30!   ->   Real Estate -> Buy a home

Buying a Home is the Best Investment You'll Ever Make

Everyone needs a place to live.  You should make it a priority to buy a home as soon as possible.  Otherwise, you are paying rent and contributing to your landlord's financial freedom.

Buying a home will probably be the largest investment you will ever make.  Carefully consider your current and future needs before you buy, and pick a home that can grow with your family.  Every time you sell one home and buy another, there are significant costs such as moving and commissions, and inconveniences such as changing addresses and phone numbers, switching schools, etc.  So, do yourself a favour and do your homework.  This will save you future hassles and costs.

If possible, it is a good idea to purchase a home within a reasonable distance of where you work, in order to avoid high travel costs and exhausting commutes.

If you have or plan to have children, the proximity to and quality of nearby schools should be taken into consideration.

You should try to ensure that the mortgage on your home will be paid off before your children enter university.  This will free up funds for their education.

Everyone needs a debt-free home to live in when they retire.  If you retire with no debt and a paid-off home, it is possible to live fairly well even if you have little savings.  At age 60, you can start collecting Canada Pension Plan (CPP).  Once you are 65, you can start collecting Old Age Security (OAS), and possibly Guaranteed Income Supplement (GIS).  There are many other federal, provincial and municipal benefits that are available to seniors which depend on your income level.  See our Government Benefits, Programs and Services page.

If you still have to pay mortgage payments after you retire, you may have problems because the mortgage payment will be a large percentage of your monthly income.

If you do not own a home when you retire, a large percentage of your monthly income will be used to pay rent, which may leave very little for other living expenses.

If, instead of buying a home, you invested in RRSPs, once you retire you will have to withdraw money from your RRSPs to pay your rent and other living expenses.  This money will be taxable income.  Your OAS may be clawed back, and you may not be eligible for GIS and many other government benefits.  You would be better off to own a home rather than the RRSPs, because the government benefits are based on income, not on assets owned.

Real estate values normally increase over the long term, and this increase is tax-free for your principal residence (see principal residence exemption).  Keep in mind that land grows in value more than the building, so it is best to buy the largest parcel of land you can afford, in a location that you think will appreciate in value.

Determine what you can comfortably afford for a mortgage payment, and this will determine how much you can spend on a home.  See our loan calculator to determine what your mortgage payments will be.  Don't forget to factor in other costs of owning a home, such as strata fees, maintenance costs, house insurance (save money by having a high deductible), property taxes, and heat and utility costs.

There are other costs to buying a home besides the purchase price, including inspection fees, appraisals, moving costs, to name a few.  See the Financial Consumer Agency of Canada article on Buying a Home.

When choosing a type of mortgage, keep in mind that historically, open mortgages with a floating rate based on prime have been the cheapest mortgages to have.  The rates are lower than fixed rate closed mortgages, and you can make extra payments whenever you can afford them.

Be sure you know the condition of the home you are planning to purchase.  A professional home inspection is advisable.

If you have been building up your RRSPs, you might consider taking advantage of the Home Buyer's Plan.

If you build or purchase a new (not just new to you) home or substantially renovate an existing home, you may qualify for a GST/HST housing rebate.

Tax Tips:

Buy a home, and pay it off before your children enter university.

Nobody plans to fail - they just fail to plan!

Your financial plan should include the following steps:

  1. Pay yourself first!
  2. Set aside emergency funds
  3. Define your goals
  4. Personal budget
  5. Buy a home
  6. Get out of debt
  7. Save and invest

Revised: October 12, 2021


Copyright © 2002 Boat Harbour Investments Ltd. All Rights Reserved.  See Reproduction of information from

Facebook  | Twitter  |  See What’s New, stay connected with by RSS or Email
The information on this site is not intended to be a substitute for professional advice.  Each person's situation differs, and a professional advisor can assist you in using the information on this web site to your best advantage. 
Please see our legal disclaimer regarding the use of information on our site, and our Privacy Policy regarding information that may be collected from visitors to our site.