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How to Buy a Home in BC with $100

by ZachBiro.Realtor 8 months ago in personal finance
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Frustrated? So are we. Read this and find a solution!

⚠ How frustrating is it to live in BC right now? ⚠

My name is Zach Biro. I am a Realtor who lives in Chilliwack, BC, Canada. I work with Homelife Advantage Realty and I'm an avid protector of the idea of the "family home". You wouldn't believe how many times I have everyday people like you and me call me with this:

"Zach! I'm incredibly annoyed right now. I have been working and working, yet I don't see ANY possible way I am going to be able to buy a home for my family now. The market is insane and I just can't keep up with the prices"!

To you, I say:

"I completely understand your frustrations. Truth be told, even if you make great money it is still going to be an uphill battle. Most single-family homes are nearing the $1,000,000 mark here just in Chilliwack unless you're handy and willing to take on a bit more work".

This of course means that in most cases, you will need to have $200,000 sitting in the bank to purchase a fairly basic home. WHAT!?!

We are playing a funny game these days. British Columbia has seen exponential growth in Real Estate valuations over the past couple of years. This has been due in part to historically low-interest rates, people being barred from investing outside of their locale, and this global pandemic we have all been facing. I don't think many of us would have predicted that the collapse of the working economy as we knew it would lead to such enormous growth in property valuations, AS WELL AS increased sales volume as a whole. If we want to refer back to a supply-and-demand market, we have been on a teeter-totter for months now.

Last Winter we endured a historically active Real Estate market with LOW inventory and HIGH demand. Things got crazier and crazier with bidding wars and homes being bought for significant amounts over asking. This grew the market. Spring came around (which has usually been the starting point of an active season) and the intensity continued. Prices kept going up. Summer rolled around and FINALLY, we were starting to see a bit of balance where the level of inventory on market was on par with the active number of Buyers in our area. Great news! Now all you needed to do was amass a sizable down-payment, hire a Realtor, and enter the battle ring that is purchasing a home. Easy, right?

UNFORTUNATELY, we all know this is not as easy as it sounds...

So here we are in Fall of 2021 now. We can start to see trends repeating themselves from last year. We have hit another low point of inventory, yet prices have gone up even a bit more than last season. Houses are selling left, right, and center, and it doesn't seem like this will be changing until some other major events occur. Perhaps a rise in interest rates could curb things, or perhaps the government will introduce some measures to level the playing field.

You will need a durable and knowledgeable Realtor to help you navigate this situation whether you are BUYING or SELLING. I'm your guy!

By Michael Longmire on Unsplash

Now. You probably clicked this article to figure out how you could buy a home with JUST $100. Here is some food for thought:

1. $100 is a great starting point. It may take time, but keep working. Pay down your debts, be diligent, and don't buy what you don't need.

2. Pile your money into high-interest solutions. You don't want to put what money you do have into anything too risky. Talk with your bank or financial advisor about your best options.

3. DO NOT QUIT YOUR JOB. Lenders will ask for at LEAST a 1-year record of income for employees or a 2-year record for those who are self-employed or running a business. Even if it's not your dream job, stick with it and keep saving. Switching paths now will only complicate things. I would rather give money to someone who has made less at the same job for a long time over someone who makes a bit more but is constantly risking stability.

4. Sell things you no longer need to help add to the savings.

5. DO NOT BUY A CAR OR OTHER LARGE LUXURIES. This right here is the mortgage killer. Many people will take on large debt or purchase a new vehicle or continue to use credit cards irresponsibly right up until they want to purchase a home. DON'T DO THAT. Lenders hate it.

6. Keep your credit cards active, but keep balances low and pay them off on time and frequently. This will show a lender that you are serious with your money. Since home prices have gone up, you need to prove that you are that much more reliable when paying things back. Create an undisputable track record.

After doing all of this you are probably sitting here with some money in the bank account and you are wondering what to do next. Maybe it's not fully enough for a downpayment, but you are close.

7. Let's talk about partnerships. Now that you have amassed something to offer, it would be a good time to talk to someone like family members or close friends, or even business people looking to invest. You can take the money you made and find someone to match or contribute more to that. From here you can get the total down-payment you need, then create a safe agreement for all parties that allows the purchase of a home sooner than you would be able to on your own. This can be a way to beat the market and save some time, as well as being an opportunity for others to make money. This can bode well for all parties involved if done correctly and safely with proper expectations. *Legal advice and a conversation with myself are recommended in this venture*.

8. Let's talk about joint ownership. Perhaps your situation allows you to live among other people. In this scenario, it could be plausible to share the purchased home with said people. This would work a bit like the partnership idea above, but with a different angle. It's going to depend on what's best for you and why you primarily need a home.

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KEEP IN MIND. Many people who already own a home have made a lot of money in equity recently. If they have no other plans for it, you may be fortunate to find someone who wants to partner with you after seeing all the hard work you put in. Prove you are serious. Make good choices.

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SO WHAT'S THE SOLUTION?

Ultimately as you may have guessed, there is simply NO easy way to go out and buy ANY property. It is going to take hard work. You need to stick to your guns and keep working and keep saving what you can until you make the money you need. Mom and dad, the bank, or your buddy down the street won't want to lend you anything if you can't prove you can manage your finances. Whether the market goes up or not, it's irrelevant if you are going to dig yourself a hole in making a purchase anyways. HOWEVER, there are ways to speed up the process to try and get you where you need to be faster. Things like partnerships, joint ownership, and creative investing can speed up the clock.

🕺🏻 I would be MORE than happy to chat with you about what you can do and help guide you along the way. Whether you just opened your first bank account or you have some money you don't know what to do with, I can give you some vision.

The general rule of thumb: AS SOON AS YOU CAN, buy SOMETHING to get into the market, and then you will realize that growth. It will keep you in the activity, and you will grow with everything else.

Buying your forever home may take a bit longer than it used to, but it is STILL POSSIBLE.

By Prateek Katyal on Unsplash

personal finance

About the author

ZachBiro.Realtor

My name is Zach. A Realtor made for you.

I grew up in the beautiful Fraser Valley in BC and I have always been proud to live where I do. We are surrounded by wonderful people & adventures to uncover. Family man at heart - let's get you home!

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