Life is moving fast, at least for us
We started house hunting in the middle of snowy February. Just a month later, when the ground was still covered by snow, we found a place that came very close to our dream home.
It ticked most boxes in our must-have and nice-to-have lists. Our offer on the home was accepted and now we are in the middle of closing and moving. Yay!
For this reason, with mixed emotions, I’ve decided to pause publishing new posts on Matcha Finance until mid June after we settle down in the new place. I’m still active on Pinterest and email channel if you want to get in touch with me.
Writing fresh and useful contents on Matcha Finance has been one of my favorite activities. But it takes a huge share of my time and brain. It’s totally fine because that’s what I love doing. I just have to re-prioritize a bit in this period to meet the moving timelime without jeopardizing my full-time work and harming the post quality on Matcha Finance.
If you’re in Canada and also thinking about buying a home
Here are some good news for you:
Increased RRSP withdrawal limit under Home Buyers’ Plan
Budget 2019 proposes to increase the RRSP withdrawal limit under the Home Buyers’ Plan (HBP) from 25,000 to 35,000. This would be available for withdrawals made after March 19, 2019. The HBP withdrawal limit of 25,000 has not been adjusted for 10 years!
Keep in mind that you have to return the money you withdraw to your RRSP in the next 15 years. Effectively, HBP is like borrowing your own money for 15 years free of interest.
The increase in the HBP withdrawal limit from 25,000 to 35,000 would be a nice help for first time home buyers who have been saving in their RRSP.
New government incentive for first time home buyer
Budget 2019 also proposes to introduce the First-Time Home Buyer Incentive: “The Incentive enables home buyers to reduce the amount of money required from an insured mortgage without increasing the amount they must save for a down payment. […] The Incentive would be available to first-time home buyers with household incomes under $120,000 per year.”
Keep an eye on this if you think you would be qualified! My home-buying deal is already done, but I’m very curious to see how this incentive would roll out.
Decreasing mortgage interest rate
On Feb 19, when we applied for a mortgage pre-approval, our mortgage broker found 3.54% to be the best 5-year fixed rate for the type and size of mortgage we were interested in.
On Feb 27, the rate dropped to 3.49%.
On Mar 13, the rate further dropped to 3.39%.
A few days later, when we were signing the mortgage paperwork after our offer on the home was accepted, we got a rate of 3.29%.
And just today, Apr 1, our mortgage broker still managed to find a rate match down to 3.19% for us.
Fixed mortage interest rate was going south fast in the last month. This was happening as the bond yield curve started to be slightly inverted.
The cost of borrowing money to buy your home is getting cheaper. Some speculators predicted the rate to drop even lower in the near term. Although there’s no guarantee that rate will keep falling, it’s just something to keep an eye on (and get savvy about) if you are seriously thinking of buying.
Can’t wait to share what I’ve learned about home buying
One month of house hunting to find what we actually love is shorter than the time most people usually spend. We are even first time home buyers.
Of course there was the luck with that particular home being listed when we were “looking for it”. But we also came to the game well prepared, well organized, and knew exactly what we wanted.
We learned how to assemble the best team of real estate professionals (real estate agent, mortgage broker, and real estate lawyer) to assist with our home purchase. We read countless resources when deciding mortgage types and terms.
I’m planning to share all I’ve learned during the home buying process on Matcha Finance when things calm down a bit in June, so stay tune!
Meanwhile, if you’re a new visitor to Matcha Finance,
Here is where you can get started when I’m away for a bit:
Get your finances in order
Spend smart and save more
The power of compound interest
Use your time wisely and stay on top of your productivity
Now I gotta go back to finalizing some paperwork and packing for my moving. Until next time!