Breaking Into the Housing Market in 2025
Right now, there’s a housing affordability crisis and it’s hitting new homebuyers the hardest. Rising prices are only part of the challenge. Stricter mortgage qualification rules, slower wage growth, and a volatile condo market in the GTA have all made entering the market increasingly difficult.
If you’re a first-time buyer trying to find a way in, here are some strategies to consider when looking to overcome today’s homeownership barriers:
Leverage Gifted Funds for a Down Payment Many first-time buyers receive financial help from family to boost their down payment. There’s no set limit on how much can be gifted, as long as the funds are available and properly documented. This can make a big difference in reducing your mortgage amount and qualifying more easily.
Use a Co-Signer to Strengthen Your Application If your income alone doesn’t meet qualification guidelines, a parent or relative can co-sign your mortgage. This can improve your debt-to-income ratio and help you qualify for a higher loan amount; often the difference between being approved or not.
Consider Early Inheritance Arrangements Some families are using early inheritance as a way to help the next generation enter the market. It’s worth discussing openly with your family and possibly a financial planner to make sure it aligns with everyone’s long-term goals.
Explore Creative Financing Options Beyond traditional mortgages, there are programs and products designed to help first-time buyers. From shared equity programs to government incentives and specialized lender solutions. A mortgage broker can help identify which options fit your situation best.
Reduce Personal Debt Before Applying Paying down credit cards, lines of credit, or car loans can have a big impact on your affordability. Lower debt levels mean better ratios, which can lead to higher mortgage approvals and lower interest rates.
Build and Maintain a Strong Credit Profile Lenders look for a minimum credit score of 680 - the higher the score, the stronger the application. Paying bills on time, keeping balances low, and avoiding unnecessary credit checks are all important steps to improve your score and your borrowing power.
Getting expert advice early can make a huge difference. A mortgage broker can walk you through the options, calculate what’s realistic, and help you build a plan to achieve your goal of homeownership.
