Like many young couples, Lex Hosh and Will Corbett enjoyed living close to the heart of town at Dockside Green.
As avid cyclists, they were close to the Galloping Goose trail and their one-bedroom suite was just down Esquimalt Road from CFB Esquimalt, where Corbett is based as a crew member of HMCS Regina.
After a while, Hosh says, it started to bother her that they were paying $1,250 a month for rent and not building any kind of nest egg for the future.
She started looking casually online at condominiums, crunched some basic numbers and realized there just might be a chance to own instead of rent.
“For 10 years I thought there was no way I could afford to buy a place in Victoria,” she says.
Her original thought was to look for something as a rental property to help build equity and perhaps be a stepping stone to buying a detached home.
She initially thought her affordable price range was between $200,000 and $250,000. When her mortgage broker told Hosh she had been pre-approved for $190,000, her hopes took a dip.
“But luckily the market in Victoria is such a great buyers market right now,” she says. “Once we adjusted our search criteria to under 200,000 I was amazed at just how much there was on the market.”
With the help of Realtor Kyle Kerr, Hosh, a first-time buyer, found a number of units fitting her financial reality. The trouble was, many of them didn’t match her requirements, which were a large kitchen and room to store their high-end bikes.
She estimates they looked at 10 to 15 condos before Kerr discovered a one-bedroom unit near Mayfair Shopping Centre that was a foreclosure sale. It was priced at $168,000 and Hosh says from the photos online it “looked pretty awful.”
Doing much of the searching herself with Corbett at sea, Hosh went to have a look anyway and found a bright unit with a large kitchen and an “awesome” floor plan and a den .
Kerr told her about the Canada Mortgage and Housing Corporation’s Purchase Plus improvement mortgage program. Aimed at people with less money to put down, the program allows the cost of renovations to be included in one’s mortgage payments, as long as the renos increase the home’s value.
Hosh saw the potential in the suite, obtained an estimate of $10,000 to upgrade the kitchen and got her financing nailed down. With some negotiations she secured a deal for $152,500 and, after the bid was accepted in court, moved in last summer.
The process took about six months, but left her feeling good about her ability to jump into the housing market.
“We’re literally saving ourselves $300 a month, with our strata fees included, from what we were paying,” she says.
Kerr points to Hosh’s situation as an illustration of the options available for first-time buyers and others.
“Older buildings that have been fixed up are some of the best buys out there,” he adds.
While price is one factor, he says, one also has to be mindful of things like strata councils’ approaches to funding ongoing maintenance and capital improvements, restrictions on rentals and limitations on children and pets.
“Stratas are such a unique thing with legalities and restrictions,” he says. “It’s important to have someone looking after your best interest and letting (clients) know about lifestyle and rentability of certain buildings and locations.”
Q: WHAT SHOULD I CONSIDER WHEN LOOKING AT CONDOS?
New vs. lived-in – Buying new can mean lower maintenance costs on your strata fees, but older buildings can offer more space for the same purchase price.
Who to borrow from? – Credit unions are exempt from many conditions that banks use to disqualify some borrowers. Although interest rates can be a little higher, credit unions have more flexibility regarding who they can lend to, and for how long.
Make sure you get a copy of the depreciation report – New legislation requires all strata to have a depreciation report completed that shows an assessment of the current state of the buildings. If none is available, take a pass on the building.
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